Start Up No.1,122: Apple’s Wearables zoom, YouTube’s Indian growth, questions for Capital One, Galaxy Fold’s bad timing, and more


Time to outlaw this kind of thing? CC-licensed photo by Steve Garfield on Flickr.

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A selection of 12 links for you. Notice how tapping your ear has stopped meaning “can’t hear you” and is “can hear you now”? I’m @charlesarthur on Twitter. Observations and links welcome.

New bill would ban autoplay videos and endless scrolling • The Verge

Makena Kelly:

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Snapstreaks, YouTube autoplay, and endless scrolling are all coming under fire from a new bill, which is sponsored by Sen. Josh Hawley (R-MO), targeting the tech industry’s “addictive” design.

Hawley’s Social Media Addiction Reduction Technology Act, or the SMART Act, would ban these features that work to keep users on platforms longer, along with others, like Snapstreaks, that incentivize the continued use of these products. If approved, the Federal Trade Commission and Health and Human Services could create similar rules that would expire after three years unless Congress codified them into law.

“Big tech has embraced a business model of addiction,” Hawley said. “Too much of the ‘innovation’ in this space is designed not to create better products, but to capture more attention by using psychological tricks that make it difficult to look away.”

Deceptive design played an enormous part in last week’s FTC settlement with Facebook, and Hawley’s bill would make it unlawful for tech companies to use dark patterns to manipulate users into opting into services. For example, “accept” and “decline” checkboxes would need to be the same font, format, and size to help users make better, more informed choices.

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Can go for the latter, but unsure about the other stuff.
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Apple third-quarter 2019 results and charts! • Six Colors

Jason Snell:

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Apple’s latest quarterly results are out and the company generated $53.8bn in revenue, up 1% versus the year-ago quarter. It was (ever so slightly) the largest third quarter in Apple history.

Mac revenue was up 11% year over year, iPad up 8%, Services up 13%, and Wearables up 68%. iPhone was down 12%.

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Just again: Wearables (and Home and Accessories) up by 68%. Which is a hell of a lot of AirPods and Watches. (And maybe HomePods. Maybe.)

The graphs tell the story pretty well. Revenues from iPhones edging down (below 50% of all revenue for the first time in aaages), but everything else is looking well. The smartphone growth story is over, for pretty much everyone except Huawei, below, but there are other stories now.
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Google reveals fistful of flaws in Apple’s iMessage app • BBC News

Leo Kelion:

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A team of bug-hunters at Google have shared details of five flaws in Apple’s iMessage software that could make its devices vulnerable to attack.

In one case, the researchers said the vulnerability was so severe that the only way to rescue a targeted iPhone would be to delete all the data off it.

Another example, they said, could be used to copy files off a device without requiring the owner to do anything to aid the hack.

Apple released fixes last week. But the researchers said they had also flagged a sixth problem to Apple, which had not been rectified in the update to its mobile operating system. [And which they’re withholding from public disclosure until its deadline – so far unknown.]

“That’s quite unusual,” commented Prof Alan Woodward, a cyber-security expert at the University of Surrey. “The reputation of the Google Zero team is such that it is worth taking notice of.”

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The bugs would have been worth millions on the black market – and still might be against phones that haven’t been updated. Over the years, iMessage has been a world of pain as well as one of Apple’s strongest selling points.
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Thuoghts on the Capital One US and Canada breach • OpenSecurity.global

Kevin Beaumont:

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A bunch of things stand out:

• Why did the WAF account apparently have access to the S3 storage buckets?
• Why wasn’t the data of hundreds of millions of people’s credit checks encrypted?  Should that kind of data have been left for so long in cloud buckets?
• Why didn’t they notice all these S3 buckets being sync’d to a random VPN IP address?  It happened 4 months ago.
• Why didn’t they notice the Gitlab pages listing their config?
• Why didn’t they notice until somebody random emailed them to tell them?

I don’t know if more details will go public (they probably don’t want it to get to trial for obvious reasons).

I guess lessons learned from outside looking in is:

– Monitoring.  Ingest your cloud logs.  Alert against them.  Monitor sites like Github and Gitlab for obviously sensitive information, e.g. usernames, bucket names etc.

And yes, this is the kind of incident that would (and still will) catch many orgs with their pants down, Capital One aren’t alone.

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It’s quite a mess, and Capital One really has harder questions to answer than “is it Amazon’s fault?”
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How regional languages are fueling YouTube’s growth in India • ETtech

Indulekha Aravind:

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The fall in data tariff caused other tectonic shifts — millions of new users came online through their phones from every corner of the country and a large section of people started watching more videos online. This statistic from media agency Zenith’s report, Online Video Forecasts 2018, is telling: if Indians spent 2 minutes a day on an average watching online videos in 2012, they were watching close to an hour a day in 2018.

This year, that figure is set to touch 67 minutes a day, the global average. Video streaming is estimated to account for 75% of mobile internet use in India by 2021, according to app analytics firm App Annie.

This meant for many Indians, video has become a window to the internet. At the centre of this shift is YouTube’s video streaming app in India, which today has 265 million active users a month. In 2016, according to Vidooly, YouTube reportedly had 60 million unique users a month.

YouTube has in a sense become a Google for users like Ahmed and Khan who prefer video to text and are more comfortable in their regional language. Google India says 2018 saw a 270% year-on-year growth in voice queries across all its platforms.

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You may be entitled to $125 or more in the Equifax breach settlement • TidBITS

Josh Centers:

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Equifax has now agreed to a $425m settlement with the Federal Trade Commission, the Consumer Financial Protection Bureau, and all 50 US states. (That’s just the amount directed to consumers—Equifax will separately pay another $175m to the states and $100m to the Consumer Financial Protection Bureau.) If you were affected by this breach—and chances are that you were—you’re entitled to either up to 10 years of credit monitoring or a $125 cash payment.

Most coverage has focused on the $125 amount, but as the FTC page clearly says and Jessamyn West emphasized on Twitter, you can claim up to 10 hours of compensation for dealing with the breach, at $25 per hour, without submitting any additional documentation, for a total payment of $375. You just have to describe what you did and the approximate dates you took those actions. If you have supporting documentation for things you had to do to deal with identity theft, fraud, or other misuse of your information, you can claim up to 20 hours, for a total of $625. And if you have unreimbursed losses or expenses due to the breach—such as fees paid to an attorney or accountant—you can apply to get up to $20,000 back.

If you choose a cash payment instead of credit monitoring, you’ll be asked to affirm that you already have credit monitoring. Credit Karma already offers this service for free, so you should take the cash.

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Please, American readers, do this. Do this. Make them hurt as much as is possible.

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Facebook connected her to a tattooed soldier in Iraq – or so she thought • The New York Times

Jack Nicas:

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Ms. Holland and Mr. Anonsen represent two sides of a fraud that has flourished on Facebook and Instagram, where scammers impersonate real American service members to cheat vulnerable and lonely women out of their money. The deception has entangled the United States military, defrauded thousands of victims and smeared the reputations of soldiers, airmen, sailors and Marines. It has also sometimes led to tragedy.

The scheme stands out for its audacity. While fraud has proliferated on Facebook for years, those running the military romance scams are taking on not only one of the world’s most influential companies, but also the most powerful military — and succeeding. Many scammers operate from their phones in Nigeria and other African nations, working several victims at the same time. In interviews in Nigeria, six men told The New York Times that the love hoaxes were lucrative and low risk.

“Definitely there is always conscience,” said Akinola Bolaji, 35, who has conned people online since he was 15, including by posing on Facebook as an American fisherman named Robert. “But poverty will not make you feel the pain.”

Facebook has long had a mission to “connect the world.” But in the process, it has created a global gathering place where the crooks outnumber the cops.

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It’s the 419 scam on steroids.
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Peloton is ending software updates for the first generation of its monitor – The Verge

Natt Garun:

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Early adopters of Peloton’s fitness bikes are in for a pricey upgrade: this week, the company announced via an email to users that it will stop sending updates to bikes using the first generation of its touchscreen monitor. This model was sold in 2014 when Peloton first launched its bike before releasing a second iteration in 2016 that allows users to cast their screen to a smart TV.

Peloton says users with the first-generation screen on their bikes will still be able to ride and access live stream and on-demand content as usual, but they will stop receiving support for new features. The company confirmed to The Verge that it will continue to support bug fixes, however. In the past few months, lag and performance issues had been a problem for users with an older monitor on their bike as the company continues to push out new updates for music control, wireless headphone support, and workout metric displays.

“Given the age and technology of [the] first generation touchscreen, it no longer accommodates the software features we regularly develop and release,” the company said in a support page and in emails to customers.

To combat the issue, Peloton is offering affected users a discount code to purchase the latest version of its screen for $350 — which is more than 50% off of the full value of $750 — for those who wanted to upgrade before this week’s news.

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So the bike works, but the screen becomes a dud. Clever upgrade offer: it’ll make a tidy profit on them.
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The Galaxy Fold’s exact release date might’ve finally leaked, and it’s horrible news • BGR

Zach Epstein:

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According to South Korean financial news site The Investor, Samsung plans to release the Galaxy Fold during the third week of September, between September 18th and September 20th.

Ouch.

Smartphone launches typically take place on Friday, so September 20th is the most likely release date. Regardless of which of those three days Samsung lands on though, it likely won’t matter. Do you know what else is probably going to happen that week? Yup, Apple will probably release its new iPhone 11, iPhone 11 Max, and iPhone 11R. In other words, there might not be a worse week during the entire year for Samsung to release a new smartphone, let alone a $2,000 flagship phone.

Based on Apple’s iPhone release schedules in the past, September 20th will indeed be the exact day Apple chooses to release its new iPhone 11 lineup. Aside from the iPhone X that was delayed until November, Apple typically chooses the second to last Friday in September to release new iPhone models. That was the case with the iPhone 8 last year, the iPhone 7 the year before, and the iPhone 6 back in 2014. The iPhone 6s launched on the last Friday of September in 2015, but only because the month ended on a Wednesday the following week.

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The problem is, the launch will go under the radar but when the flaws start showing up, it’ll be a couple of weeks down the line, in a relative news drought.
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What Huawei didn’t say in its ‘robust’ half-year results • TechCrunch

Rita Liao:

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The media has largely bought into Huawei’s “strong” half-year results today, but there’s a major catch in the report: the company’s quarter-by-quarter smartphone growth was zero.

The telecom equipment and smartphone giant announced on Tuesday that its revenue grew 23.2% to reach 401.3 billion yuan ($58.31bn) in the first half of 2019 despite all the trade restrictions the U.S. slapped on it. Huawei’s smartphone shipments recorded 118m units in H1, up 24% year-over-year.

What about quarterly growth? Huawei didn’t say, but some quick math can uncover what it’s hiding. The company clocked a strong 39% in revenue growth in the first quarter, implying that its overall H1 momentum was dragged down by Q2 performance.

The firm shipped 59m smartphones in the first quarter, which means the figure was also 59m units in the second quarter. As tech journalist Alex Barredo pointed out in a tweet, Huawei’s Q2 smartphone shipments were historically stronger than Q1.

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As Barredo pointed out, they used to grow 32.5% on average from Q1 to Q2. To stall to 0% – especially with the growth seen in China – means the wheels really fell off with Trump’s ban.
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LG’s Q2 smartphone sales continue to slow with 21% YoY revenue drop • 9to5Google

Ben Schoon:

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Announced in a press release today, LG has confirmed its second-quarter results with stronger sales for the company as a whole, but a 15.4% drop in overall operating income. In the mobile division specifically, though, the news wasn’t so great.

LG saw an increase between Q1 and Q2 of 2019, seeing sales of US$1.38bn. That’s an increase of 6.8% between the two quarters, but a drop of 21.9% compared to the same period in 2018. LG puts the blame on the overall stagnant demand and aggressive pricing from Chinese brands.

The mobile division also saw an operating loss of US$268.4m as it invests in relocating its smartphone production to Vietnam. LG says that it expects things to improve in Q3 with the “growing demand” for 5G smartphones as well as the introduction of “competitive mass-tier smartphones,” meaning we’ll likely see some mid-range devices this fall.

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LG is just shovelling money into a furnace there, and though it hasn’t released its smartphone sales figures for about a year, but there’s no reason to think they’re increasing. Legacy players here are just throwing good money after bad.
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Sony has sold 100 million PlayStation 4 consoles • Engadget

Steve Dent:

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Despite flagging sales of late, Sony’s PlayStation 4 has sold 100m units, making it the fastest-selling console to hit that number. In its latest earnings report, Sony revealed that it sold 3.2m PS4s between March 31st and June 30th, after announcing that 96.8m units had sold in the previous quarter. That means it hit the 100m figure on the nose in five years and seven months, just two months quicker than Nintendo’s Wii.

Sony also revealed that for the first time, folks are buying more games via digital downloads than physical discs, marking a trend that’s been ongoing for a while now.

Despite its half-decade age, PS4 sales have never really flagged until recently, with 17.8m sold last year, down just 1.2m over 2017. However, it took a noticeable dive last quarter, and Sony has warned that it expects 2019 sales to be down more than it originally forecast last quarter. A slow demise in PS4 sales is to be expected, though, considering that Sony’s next-gen PS5 should arrive in fall of 2020, with support for ray-tracing 8K, SSD storage and PS4 backward-compatibility.

In other Sony news, smartphone revenue dropped by 15% over last quarter, continuing what seems like a never-ending trend. It sold less than half the number of smartphones it did during the same period last year, just 900,000 in total. To give you an idea of how bad that is, total units sold in 2018 was less than half of 2017, and so far, 2019 is half of 2018.

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Sony should just name its next smartphone the Zeno. But – and here’s the big thing – it actually eked out an operating income, after a solid year of loss, of US$9.4m on revenue of $914m – so each phone had an average price of $1,015.
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Errata, corrigenda and ai no corrida: none notified

1 thought on “Start Up No.1,122: Apple’s Wearables zoom, YouTube’s Indian growth, questions for Capital One, Galaxy Fold’s bad timing, and more

  1. Is there any data on iOS Android switching ? That’s what matters in the long term now that the market this mostly saturated, and I haven’t seen anything detailed and authoritative in a while, only footnotes hinting at some iOS loss.

    It seems we only get info corps want to PR about, so not the deep meaningful stuff.

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